Tyman — Focus on strategic progress and position

Tyman (LN: TYMN)

Last close As at 22/11/2024

318.50

−4.50 (−1.39%)

Market capitalisation

625m

More on this equity

Research: Industrials

Tyman — Focus on strategic progress and position

Headline earnings growth was modest in 2018 but, in our view, steps taken during the year reinforced and extended the group’s strong strategic positioning in its leading markets. Our estimates are modestly lower and more in line with consensus now, we believe. The current valuation – with single-digit P/E multiples – looks unduly bearish and we continue to expect that the company will outperform its underlying markets.

Analyst avatar placeholder

Written by

Industrials

Tyman

Focus on strategic progress and position

FY18 results

Construction & materials

21 March 2019

Price

252p

Market cap

£496m

Net debt (£m) at 31 December 2018

208.8

Shares in issue

196.2m

Free float

91%

Code

TYMN

Primary exchange

LSE

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

3.9

7.8

(13.6)

Rel (local)

1.8

(0.7)

(16.1)

52-week high/low

358.0p

222.5p

Business description

Tyman’s product portfolio substantially addresses the residential RMI and building markets with increasing commercial sector exposure following acquisitions. It manufactures and sources window and door hardware and seals, reporting in three divisions: AmesburyTruth (North America; 64% of reported FY18 revenue), ERA (UK ;16%) and SchlegelGiesse (RoW; 20%).

Next events

FY18 DPS 8.25p ex dividend

18 April

AGM

9 May

FY18 DPS to be paid

24 May

H119 results announcement

25 July

Analyst

Toby Thorrington

+44 (0)20 3077 5721

Tyman is a research client of Edison Investment Research Limited

Headline earnings growth was modest in 2018 but, in our view, steps taken during the year reinforced and extended the group’s strong strategic positioning in its leading markets. Our estimates are modestly lower and more in line with consensus now, we believe. The current valuation – with single-digit P/E multiples – looks unduly bearish and we continue to expect that the company will outperform its underlying markets.

Year end

Revenue (£m)

PBT*
(£m)

EPS*
(p)

DPS
(p)

P/E
(x)

Yield
(%)

12/17

522.7

68.3

26.7

11.3

9.5

4.4

12/18

591.5

72.7

27.5

12.0

9.2

4.7

12/19e

625.8

83.8

31.1

13.5

8.1

5.3

12/20e

642.5

92.0

34.1

14.5

8.4

5.7

Note: *PBT and EPS (fully diluted) are normalised, as defined by Tyman, excluding intangible amortisation and exceptional items.

Another active year – clear strategic progress

2018 results were broadly in line with our estimates, with a 3% EPS uplift not really telling the story of another active year for organic and acquisitive progress. The year was characterised by variable market conditions both across and within regions. Nevertheless, management stuck closely to its well-flagged business improvement initiatives – especially footprint optimisation - and successfully completed four complementary acquisitions in the year (two in the UK, one US and one European), the largest of which was Ashland Hardware in the US, partly funded by new equity. Net debt at the end of the year was £209m, down from the interim stage but higher than the end 2017 level. Good underlying cash flow was in evidence including during the seasonally stronger second half.

Some clear 2019 drivers

When Tyman reports its next results it will be under the stewardship of new CEO Jo Hallas following the impending retirement of Louis Eperjesi (CEO since 2010). The search for a new CFO is also underway to replace James Brotherton, who is leaving to take up another role with effect from 31 July. Although we have trimmed our US margin expectations leading to modest earnings reductions, we expect to see Tyman deliver the benefits of a well-managed footprint change process (in North America and the UK), demonstrate ongoing momentum in the rest of the world operations and also bring through full year acquisition effects as 2019 progresses.

Valuation: Focus on business qualities

After a weak close to 2018/start to 2019, Tyman’s share price has risen by c 13% from January lows including a good initial reception for the FY18 results. However, it remains well down from the 357p 2018 high seen in September. Consequently, the company’s valuation multiple looks somewhat depressed at 8.1x P/E, 6.1x EV/EBITDA (adjusted for pensions cash) with an anticipated dividend yield of 5.3% for 2019. Slowing economic growth and net debt levels could be possible weights on the share price, though we believe that self-help momentum and good prospective cash generation represent strong counters to these points.

FY18 results overview

All three reporting divisions delivered increased profitability in FY18 through varying combinations of acquisition effects and underlying progress. Two of Tyman’s three divisions improved their underlying year-on-year revenue and profitability performances in H2, though the larger North American operation experienced some market pressures. Acquisition activity led to an increase in net debt – partly mitigated by good underlying cash flow – which stood just below 2x annualised EBITDA at the year end.

Exhibit 1: Tyman divisional and interim splits

December year end
£m

H1

H2

2017

H1

H2

2018

Actual

y-o-y chg

H118

Actual

y-o-y chg

FY18

CER LFL

CER LFL

H118

FY18

Group revenue

260.4

262.3

522.7

274.9

316.7

591.5

5.6%

13.2%

3.0%

2.7%

AmesburyTruth

166.1

166.7

332.7

176.6

202.1

378.7

6.4%

13.8%

3.6%

2.5%

SchlegelGiesse

54.4

55.3

109.7

55.5

61.6

117.2

2.1%

6.8%

3.2%

6.0%

ERA

39.9

40.3

80.3

42.8

53.0

95.7

7.0%

19.3%

-2.5%

-1.0%

Group operating profit (reported, post SBP)

35.5

41.3

76.8

38.2

45.4

83.6

7.3%

8.8%

3.0%

8.8%

AmesburyTruth

27.4

32.3

59.7

30.0

32.3

62.3

9.5%

4.3%

6.0%

-8.0%

SchlegelGiesse

6.3

6.5

12.8

6.8

8.3

15.0

7.0%

17.8%

9.8%

18.1%

ERA

5.6

4.6

10.2

4.8

7.7

12.5

-16.7%

22.2%

-28.6%

-9.8%

Central costs

(3.8)

(2.1)

(5.9)

(3.4)

(2.9)

(6.3)

Source: Company

AmesburyTruth (FY18 revenue US$506m, EBIT pre-central US$83.1m, margin 16.4% -150bp)

The US newbuild housing market ran at a slower pace in the second half of the year, while its Canadian equivalent was flat overall. Against our estimates, AmesburyTruth’s (AT’s) revenues were in line though EBIT was c £2m (or c 3%) light, equivalent to c 70bp of margin. AT’s margins are normally higher in H2 but that was not the case in 2018 (ie 16% vs 17% seen in H1). Management comments did indicate that some costs tracked higher than previously expected, specifically healthcare, production scrap and freight. We suspect that the two latter points were inter-related and reflected production ramp-up issues at new facilities (similar but on a smaller scale to Juarez in 2017).

Underlying volume is said to have been flat for the year with top-line progress therefore generated by some year-on-year pricing pass-through effects. In sub-sector terms, commercial revenues grew faster than the underlying divisional rate (and to c 13% of AT overall) driven by a strong contribution from Bilco (access and egress hatches). Implicitly, residential volumes were slightly down and this is consistent with AT’s stronger presence with larger door and window suppliers who are more exposed to the newbuild market. Higher input costs in the early part of the year supported increased average selling prices. As divisional gross margins declined by 200bp (to 32.4%) we suspect that higher material costs were not fully recovered in the year, though the acquisition of Ashland Hardware may have also contributed to this outcome.

Ashland was part of the group for less than 10 months but implicitly delivered EBIT well ahead of its pre-acquisition year to December 2017 level (ie $8.25m) at an above divisional average margin. Since taking ownership responsibility, a Toronto facility has been exited using AT’s distribution capability in the vicinity and with light assembly activities consolidated into Ashland’s Monterrey manufacturing plant. Other integration steps taken included combining sales, marketing and product ranges and moving the acquired business onto AT’s own IT system. Based on capturing some of these early gains, Tyman’s original synergy target of $4m was raised to $5m (by 2020) but even before these are fully achieved, Ashland (acquired for c £73m) is on track to exceed management’s target acquisition ROCE of 15%.

The heavy lifting in the multi-phase footprint improvement programme, which started in 2015, is largely complete and collective actions to date yielded a maiden $1.7m benefit during the year. Ongoing manufacturing and warehousing facilities are now in place and limited incremental capex to complete the programme is required. That said, a further c $13m spending over the next two years is anticipated (taking the total net cash cost to c $37m) to generate the efficiency of AT’s capital base. The divisional target EBIT margin is unchanged at 20% and, in support of this, the majority of the planned $10m annualised benefit by 2020 from the footprint optimisation project is still to flow through. The incremental $8.3m on a base of c $520–530m revenue by 2020 would represent c 160bp of EBIT margin if retained. It is also reasonable to expect greater marketing and commercial focus backed up by a more efficient capital base. Expected incremental synergies from the Ashland acquisition (understood to be c $3.7m by 2020) also support margin improvement initiatives. In the near term, management planning for volume growth in 2019 and price increases in the order of 3–4% were put through at the beginning of the year. Undersupply in the US housing market remains a key macro driver, although rising interest rates and a forecast slowing in remodelling spending (to c 5% by Q419 according to Harvard LIRA) represent cautionary notes.

SchlegelGiesse (FY18 revenue €132.4m, EBIT pre-central €17.0m, margin 12.8% +120bp)

The SchlegelGiesse (SG) division does offer selected hardware and seals product ranges into the US and UK markets but substantially addresses the remaining international territories from its European headquarters through a combination of direct sales, distributor and agent relationships. Its manufacturing base is primarily in Europe, save for weatherseal facilities in Brazil and Australia and a hardware facility in China. In underlying revenue terms, year-on-year momentum improved as the 2018 year progressed and this in turn drove a strong EBIT margin uplift of 120bp on a reported basis to 12.8% (including +170bp y-o-y in H2 to 13.4%).

Based on management comments, we perceive that increasing emphasis on marketing the product portfolio’s breadth supported by high service levels with increasing efficiency is strengthening SG’s position in its markets and leading to share gains. Heartland European sales performances were generally positive with the odd exception and collectively grew underlying revenues by 6%, in line with the equivalent figure for the division as a whole. Individual country performances ranged from (unspecified) double-digit increases in some cases to small single-digit declines elsewhere. In addition, Reguitti (a complementary Italy-based interior and exterior door hardware supplier) made a four-month contribution to European sales, though these are excluded from our underlying commentary and the right-hand side of Exhibit 1. Elsewhere, growth in China was strong following distribution changes made in the prior year, although other Asia-Pacific markets together with the Middle East and Latin America saw patchy to soft demand for a number of different reasons.

Although it is difficult for us to assess externally, indicated share gains across a wide variety of markets suggest that SG is aligning its manufacturing footprint and distribution capabilities in an increasingly coherent and effective manner. While some local markets experienced lower revenues, SG appears committed to the regions outlined earlier and in the case of Asia-Pacific and the Middle East is actively putting in further resource to improve traction there. Overall, further SG progress is anticipated by management in 2019 and its previously stated target EBIT margin of 15% remains intact.

ERA (FY18 revenue £96m, EBIT pre-central £12.5m, margin 13.1% +40bp)

2018 was a busy year for ERA in markets that were generally unhelpful, though better in H2 than H1. In Q1, the move to a new divisional head office took place also involving the consolidation of two warehousing, distribution and light assembly sites. This i54 facility is now the focal point for divisional sales, marketing and new product development especially for residential repair, maintain and improvement, or RMI, product groupings (around two-thirds of annualised sales). The commercial segment (built around the acquired Howe Green, Bilco UK and latterly Zoo Hardware and Profab businesses) represents the other third of annualised revenues.

Management considers that its UK door and window market was down 4% over the year as a whole; given that H1 was down 8%, this indicates that year-on-year comparatives improved and moved into positive territory in H2. ERA’s underlying trading pattern mirrored this and the small revenue decline – with price increases not quite offsetting lower volume – suggests small market share gains overall. Within its market channels, OEM volumes were slightly down while those through distributors were approximately flat. In both cases, the equivalent outturns in value terms were flat and modestly positive respectively, factoring pricing uplifts. Underlying profitability also improved modestly in H2, most likely reflecting better input cost recovery and benefits from site consolidation flowing through.

The in-year acquisition of Zoo Hardware (a Carlisle-based supplier into the distributor and commercial channels) was the primary driver of headline divisional progress. It maintained the c 11% y-o-y growth rate seen at the interim stage (ie versus the pre-ownership period) at the full year stage and, we estimate, delivered above-average EBIT margins to make a material contribution to the divisional outturn from just over eight months of ownership. The smaller Profab (interior access panels and steel and riser doors, acquired in July) also chipped in and helps to build out ERA’s commercial Access Solutions offering. Sales into this sub-sector tend to be more project-oriented and, hence, subject to lumpiness and timing variability and, as a result, revenues here were slightly below the prior year.

During 2019 to date, ERA has expended its existing electronic security product offering (ERA Home Smartware) with the acquisition of Y-Cam Solutions, a cloud-based security system platform provider for the domestic market. The initial consideration was £1m but the capped three-year earn-out up to £10m indicates prospective growth rates in this space. Otherwise, management has maintained its medium-term sustainable EBIT margin target of 15% for this division. Notwithstanding a fairly flat near-term UK residential market outlook and potential Brexit uncertainty, further operational benefits from i54 together with acquisition momentum suggest that ERA will continue to do relatively well in 2019.

Good underlying cash flow expected to continue

Net debt increased by £46m over the course of 2018 to £209m at the year end. Of this movement, c £12m related to adverse year-end FX translation of overseas funding.

On our definition, underlying operating cash flow (before pension and exceptional cash outflows) of c £95m was £17m above the prior year level; higher EBITDA profitability explained c £7m of this and a much smaller working capital outflow the remainder (at £3.9m in 2018). Inventory investment was around half the level seen in 2017 while the creditor movement switched from an outflow to an inflow. Non-trading cash outflows of c £10m were at a similar level year-on-year in 2018 with the majority relating to restructuring activities with smaller amounts for M&A and pensions cash contributions. (The net restructuring cash movement was somewhat lower, noting that c £3.5m of exited property disposal proceeds were received in the year, which we recorded under fixed asset sales/net capex.)

Cash interest and taxation payment outflows were both slightly below their P&L equivalents. Gross capex at c £17m was marginally above the 2017 level and compared to c £14m depreciation and amortisation (of own intangibles) in the year. Spend increased in AT and SG, while that for ERA stepped down as the cost of its new facility was substantially incurred in 2017. As mentioned above, property disposal receipts netted capex spend for 2018 down to £12m. After all of the above items, Tyman’s 2018 free cash inflow was c £52m (or c £57m underlying).

The cash acquisition consideration paid during 2018 totalled c £106m, comprising Ashland (c £73m), Zoo Hardware (c £14m), Reguitti (c £14m) and the remainder, net of cash acquired, was on Profab. (An additional £1.4m shares were issued as part payment for Zoo, where there is a similar amount of deferred consideration.) This M&A activity was partly funded by c £47m new equity funding. A small dividend uplift and the increased number of shares in issue led to higher cash dividend payments in 2018, to around £22m.

Cash flow outlook: Year-end net debt to 2018 EBITDA was just above 2x on a reported basis or just below 2x on an annualised basis (ie allowing for acquisition full-year effects). We anticipate that this multiple will decline to c 1.6x by the end of 2019. This is despite the higher AT operating exceptional spend flagged earlier. Including this we project positive group free cash flow of £56m in 2019 – more than twice our expected cash dividend payment – rising to almost £70m in 2020 and a little more beyond that. IFRS 16 accounting effects from 1 January 2019 (see below) will inflate both balance sheet debt and P&L depreciation charge/EBITDA but banking covenants will continue to be calculated on the pre-IFRS 16 basis (so-called frozen GAAP).

Estimates trimmed towards consensus

Slowing economic growth globally and in Tyman’s primary trading regions is the widely reported backdrop narrative at the beginning of 2019, overlaid with some cross-border trade uncertainties. Tyman believes that it is not unduly exposed to the latter risks, being either outside current tariff focus areas and/or with an ability to manage its supply chain to manage potential short-term disruption.

Our pre-results estimates were slightly above consensus and, having trimmed margin expectations in AT, we believe that we are now more in line. This EBIT reduction is partly offset by lower expected finance costs, leaving our earnings estimates for FY19 and FY20 down by 5.5% and 2.6%, respectively.

Exhibit 2: Tyman estimate revisions

EPS (p) FD Edison norm

PBT (£m) Edison norm

EBITDA (£m)

Old

New

% chg.

Old

New

% chg.

Old

New

% chg.

2018

27.7

27.3

-1.7

73.2

72.2

-1.3

100.0

98.5

-1.4

2019e

32.8

31.0

-5.5

88.1

83.5

-5.2

117.7

111.8

-5.0

2020e

34.9

34.0

-2.6

93.8

91.7

-2.2

123.2

119.9

-2.6

2021e

N/A

35.5

N/A

N/A

95.6

N/A

N/A

123.9

N/A

Source: Edison Investment Research. Note: 2018 old = Edison estimate, new = actual.

Note that we expect 2018 results to be restated for IFRS 16 – Leases during the course of 2019. Management’s illustrative analysis indicates that this will result in a c 5.5% reduction in reported 2018 underlying EPS and a 90bp reduction in ROCE (to 12.5%). The former effect is a result of higher combined depreciation and interest charges (versus the lease cost previously), while ROCE dilution reflects a change to deferred lease treatment.


Exhibit 3: Financial summary

£m

2011

2012

2013

2014

2015

2016

2017

2018

2019e

2020e

2021e

Year end 31 December

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

PROFIT & LOSS

 

 

Cont.

Cont.

 

 

 

 

 

 

 

 

 

Revenue

 

 

216.3

228.8

298.1

350.9

353.4

457.6

522.7

591.5

625.8

642.5

659.6

Cost of Sales

 

 

(145.2)

(154.0)

(198.8)

(236.1)

(234.0)

(290.4)

(331.8)

(383.3)

(393.6)

(399.3)

(409.9)

Gross Profit

 

 

71.1

74.7

99.3

114.8

119.4

167.3

190.9

208.3

232.1

243.2

249.8

EBITDA

 

 

27.7

28.5

39.4

54.6

60.9

82.5

91.7

98.5

111.8

119.9

123.9

Operating Profit (Edison)

 

 

22.4

23.4

33.0

46.9

52.9

70.9

78.8

84.7

95.7

103.4

106.8

Net Interest

 

 

(5.9)

(3.3)

(3.4)

(4.5)

(6.0)

(6.9)

(8.0)

(10.1)

(10.5)

(10.0)

(9.5)

Other Finance

 

 

(3.6)

(0.9)

0.2

(2.2)

(0.6)

(0.4)

(0.8)

(1.3)

(0.5)

(0.5)

(0.5)

Share Based Payments

 

 

(0.2)

(0.5)

(0.7)

(0.9)

(1.0)

(1.0)

(2.0)

(1.1)

(1.2)

(1.2)

(1.2)

Intangible Amortisation

 

 

(10.6)

(10.8)

(16.6)

(17.8)

(19.6)

(21.7)

(22.9)

(25.8)

(28.2)

(28.2)

(28.2)

Exceptionals

 

 

0.7

(33.4)

(11.4)

(9.3)

(9.4)

(10.9)

(10.0)

(7.3)

(2.9)

(1.8)

0.0

Other

 

 

(0.1)

(0.4)

(0.4)

(0.3)

(0.4)

(0.5)

(0.6)

(0.2)

(0.2)

(0.2)

(0.2)

Profit Before Tax (Edison norm)

 

12.7

18.7

29.2

39.3

45.4

62.5

68.0

72.2

83.5

91.7

95.6

Profit Before Tax (Company norm)

 

17.4

21.3

28.6

41.6

45.4

62.1

68.3

72.7

83.8

92.0

95.9

Profit Before Tax (FRS 3)

 

 

2.6

(25.8)

0.8

11.9

16.1

29.4

34.5

38.9

52.3

61.5

67.2

Tax

 

 

6.4

3.7

0.2

(2.6)

(8.0)

(8.6)

(3.3)

(12.5)

(14.3)

(16.5)

(17.6)

Profit After Tax (norm)

 

 

19.1

22.4

29.4

36.8

37.3

53.8

64.7

59.7

69.2

75.2

78.0

Profit After Tax (FRS 3)

 

 

9.1

(22.1)

1.0

9.3

8.1

20.7

31.2

26.3

38.0

45.0

49.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average number of shares outstanding (m) 

129.7

129.7

152.8

167.8

168.2

173.0

177.2

191.4

194.8

194.8

194.8

EPS - Edison normalised (p) FD 

6.7

9.6

13.9

17.1

19.3

25.5

26.6

27.2

31.0

34.0

35.5

EPS - Company normalised (p) FD

9.4

10.2

13.5

18.4

19.4

25.3

26.7

27.5

31.1

34.1

35.6

EPS - FRS 3 (p)

 

 

6.8

(16.7)

0.6

5.6

4.8

12.0

17.6

13.8

19.5

23.1

25.5

Dividend per share (p)

 

 

3.4

4.5

6.0

8.0

8.8

10.5

11.3

12.0

13.5

14.5

15.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Margin (%)

 

 

32.9

32.7

33.3

32.7

33.8

36.5

36.5

35.2

37.1

37.8

37.9

EBITDA Margin (%)

 

 

12.8

12.5

13.2

15.6

17.2

18.0

17.5

16.7

17.9

18.7

18.8

Operating margin (before GW and except.) (%)

10.4

10.2

11.1

13.4

15.0

15.5

15.1

14.3

15.3

16.1

16.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE SHEET

 

 

Cont.

Cont.

 

 

 

 

 

 

 

 

 

Fixed Assets

 

 

352.8

298.1

404.2

410.6

398.4

564.7

511.5

605.7

586.7

560.7

534.1

Intangible Assets

 

 

312.7

258.7

354.4

355.7

340.5

480.0

427.2

516.9

489.9

462.0

434.0

Tangible Assets

 

 

30.5

29.8

39.9

42.9

42.8

71.7

68.4

77.0

79.4

81.3

82.7

Investments

 

 

9.6

9.5

9.8

12.1

15.0

12.9

15.9

11.9

17.4

17.4

17.4

Current Assets

 

 

96.4

90.7

118.9

124.0

111.0

180.6

188.1

244.8

273.4

315.7

362.8

Stocks

 

 

26.6

27.6

40.7

47.6

46.0

70.7

75.3

105.3

106.1

107.7

110.5

Debtors

 

 

49.3

27.3

34.7

37.1

35.0

69.0

70.2

87.7

88.7

90.6

92.6

Cash

 

 

20.4

35.9

43.6

39.3

30.0

40.9

42.6

51.9

78.5

117.4

159.7

Current Liabilities

 

 

(55.1)

(44.2)

(60.8)

(52.3)

(44.4)

(86.4)

(82.0)

(102.9)

(97.2)

(98.8)

(102.1)

Creditors

 

 

(42.2)

(36.7)

(54.0)

(52.3)

(44.4)

(86.4)

(80.9)

(101.4)

(97.2)

(98.8)

(102.1)

Short term borrowings

 

 

(12.9)

(7.5)

(6.8)

0.0

0.0

0.0

(1.1)

(1.5)

0.0

0.0

0.0

Long Term Liabilities

 

 

(144.8)

(96.9)

(161.7)

(176.2)

(156.7)

(285.3)

(251.4)

(320.5)

(319.4)

(318.3)

(317.2)

Long term borrowings

 

 

(100.2)

(63.6)

(115.5)

(128.0)

(111.6)

(216.5)

(204.3)

(259.2)

(259.2)

(259.2)

(259.2)

Other long term liabilities

 

 

(44.6)

(33.3)

(46.2)

(48.2)

(45.1)

(68.8)

(47.0)

(61.3)

(60.2)

(59.1)

(58.0)

Net Assets

 

 

249.2

247.7

300.6

306.1

308.3

373.6

366.2

427.1

443.4

459.3

477.7

 

 

 

0.000

 

 

 

 

 

 

 

 

 

 

CASH FLOW

 

 

Cont.

Cont.

 

 

 

 

 

 

 

 

 

Operating Cash Flow

 

 

32.6

23.6

38.9

40.1

49.4

79.9

67.0

85.0

99.3

114.2

118.8

Net Interest

 

 

(6.7)

(4.2)

(2.6)

(4.6)

(6.2)

(7.0)

(7.6)

(9.1)

(10.5)

(10.0)

(9.5)

Tax

 

 

(1.9)

(4.9)

(6.2)

(6.3)

(8.9)

(12.7)

(15.1)

(12.3)

(13.8)

(16.0)

(17.1)

Capex

 

 

(4.9)

(6.8)

(8.1)

(10.2)

(10.9)

(15.3)

(12.6)

(12.0)

(18.6)

(18.6)

(18.6)

Acquisitions/disposals

 

 

(10.3)

51.2

(131.2)

(6.5)

6.8

(96.1)

(6.3)

(106.4)

(1.0)

(1.5)

0.0

Financing

 

 

(0.3)

(1.1)

68.1

(4.3)

(2.6)

16.7

(0.8)

47.2

(2.0)

(2.0)

(2.0)

Dividends

 

 

(2.6)

(5.8)

(7.0)

(10.9)

(14.6)

(15.6)

(19.5)

(22.4)

(25.2)

(27.2)

(29.2)

Net Cash Flow

 

 

6.0

51.9

(48.2)

(2.8)

13.0

(50.0)

5.1

(30.1)

28.1

38.9

42.3

Opening net debt/(cash)

 

 

91.7

92.7

35.2

78.7

88.7

81.6

175.6

162.9

208.8

180.7

141.8

HP finance leases initiated

 

 

(2.7)

0.0

0.0

0.0

0.0

0.0

0.0

(2.0)

0.0

0.0

0.0

Other

 

 

(4.4)

5.6

4.7

(7.2)

(5.9)

(44.0)

7.6

(13.9)

0.0

0.0

0.0

Closing net debt/(cash)

 

 

92.7

35.2

78.7

88.7

81.6

175.6

162.9

208.8

180.7

141.8

99.5

Source: Tyman accounts, Edison Investment Research


General disclaimer and copyright

This report has been commissioned by Tyman and prepared and issued by Edison, in consideration of a fee payable by Tyman. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the Edison analyst at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2019 Edison Investment Research Limited (Edison). All rights reserved FTSE International Limited (“FTSE”) © FTSE 2019. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Myonlineadvisers Pty Ltd who holds an Australian Financial Services Licence (Number: 427484). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

Neither this document and associated email (together, the "Communication") constitutes or form part of any offer for sale or subscription of, or solicitation of any offer to buy or subscribe for, any securities, nor shall it or any part of it form the basis of, or be relied on in connection with, any contract or commitment whatsoever. Any decision to purchase shares in the Company in the proposed placing should be made solely on the basis of the information to be contained in the admission document to be published in connection therewith.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document (nor will such persons be able to purchase shares in the placing).

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

The Investment Research is a publication distributed in the United States by Edison Investment Research, Inc. Edison Investment Research, Inc. is registered as an investment adviser with the Securities and Exchange Commission. Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a) (11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been commissioned by Tyman and prepared and issued by Edison, in consideration of a fee payable by Tyman. Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the Edison analyst at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2019 Edison Investment Research Limited (Edison). All rights reserved FTSE International Limited (“FTSE”) © FTSE 2019. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Myonlineadvisers Pty Ltd who holds an Australian Financial Services Licence (Number: 427484). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

Neither this document and associated email (together, the "Communication") constitutes or form part of any offer for sale or subscription of, or solicitation of any offer to buy or subscribe for, any securities, nor shall it or any part of it form the basis of, or be relied on in connection with, any contract or commitment whatsoever. Any decision to purchase shares in the Company in the proposed placing should be made solely on the basis of the information to be contained in the admission document to be published in connection therewith.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document (nor will such persons be able to purchase shares in the placing).

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

The Investment Research is a publication distributed in the United States by Edison Investment Research, Inc. Edison Investment Research, Inc. is registered as an investment adviser with the Securities and Exchange Commission. Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a) (11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1,185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

More on Tyman

View All

Latest from the Industrials sector

View All Industrials content

Research: TMT

Thin Film Electronics — Focus on NFC projects with silicon tags

Thinfilm has announced a corporate restructuring intended to reduce the amount of cash consumed until the business become cash generative. We place our estimates under review until there is more visibility on the impact of the far-reaching cost-saving programme, capex in particular.

Continue Reading

Subscribe to Edison

Get access to the very latest content matched to your personal investment style.

Sign up for free